Hynix Becomes SK Hynix, Plans to Start Making Custom Chips.

SK Group, an industrial conglomerate from South Korea, has invested into Hynix Semiconductor an undisclosed sum of money. As a result, Hynix became a new member of SK group and on Monday changed its name to SK Hynix. At the inauguration ceremony, SK Hynix declared to take off for "the world’s best semiconductor company" and expand its business with various chips, which means that it will not be just a memory maker.

With this, SK group has acquired another future growth engine on top of its core business of energy and telecommunications. The group is also able to accelerate its global business management and in turn, the maximized synergy will eventually lead the new paradigm of the ICT industry by combining competence in telecommunications and semiconductors.

By creating a synergy with SK group, SK Hynix will be able to expand its business scope beyond a memory semiconductor provider and aim for the global leader in the semiconductor industry. SK Hynix plans to further strengthen its mobile business such as mobile DRAM, NAND flash and CMOS image sensor following the new IT trend in view of the application shift from PC-based to the mobile-centered. Also, the company will enhance its leading position in China, the world’s largest semiconductor market with the SK group’s strategy of ‘China Insider’. In addition, SK Hynix will focus on System IC business and secure competent human resources for the long-term growth.

SK Hynix was founded in 1983 with the name of Hyundai Electronics Industries and it merged LG Semiconductor in 1999. In 2001, it changed the name to Hynix semiconductor and ever since it has well recognized as a leading memory solution provider and now is the world’s second largest memory chip manufacturer.

Discussion

SK invested $3B in Hynix, and became the highest stock holder. The SK group appointed a Co-CEO (whom seems to have a knack for getting embezzlement charges).

This is after Micron tried numerous times to do something similar. Instead, Micron ended up with Elpida.

However it went down, this is both good and bad. On one hand consolidation is bad for the consumer, and drives up pricing. On the other hand, these asset gains and cash infusions allow the companies to spend more on R&D to compete with the 800lb gorilla in this space.